Cambodia Bans Crypto Transactions While Developing State-Backed EntapayMar 14, 2018 at 15:16
Cambodia’s crypto industry is temporarily paralyzed as its government banned financial institutions from engaging in cryptocurrency transactions while Entapay, the state backed cryptocurrency is being developed.
According to The Pnom Penh Post, cryptocurrency entrepreneurs in Cambodia decries the country’s laws governing cryptocurrency being uncertain as the government has opposed cryptocurrencies while supporting their technology.
Local crypto players including Khmer Crypto Foundation’s lead developer, Mean, cited the National Bank of Cambodia’s reluctance to support cryptocurrency. However, the KHCoin developer said that he understood that the government’s uncertainty is driven by scams, volatility and lack of regulation for cryptocurrencies.
Last December, the national bank declared cryptocurrency transactions illegal when Mean tried to monetize KHCoin after first offering it for free. The Cambodian central bank banned banks and microfinance institutions from buying, selling and advertising cryptocurrencies.
With the said move, Cambodian banks prevented customers from using their bank accounts to buy or sell cryptocurrencies even if the government has not outlawed people from owning virtual assets.
However, prior to the National Bank of Cambodia’s banning of crypto transactions, it has signed an agreement with a Japanese firm to develop a blockchain project to track interbank transactions and lending history.
The country’s restrictions on cryptocurrencies also undermined developers’ efforts to pursue blockchain technology.
The Cambodian government expects Entapay to be a multi-functional digital currency payment system consisting of storage management, trading, exchange and offline transactions that will be decentralized.
It is also being developed to feature secure encryption and transmission of information as well as to remove management of multi-digital currencies and insufficient physical trading sites.
Cambodia however did not give a timeline on the launching of Entapay.